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Episode 04-2022 | Sometimes on a long journey, the first step is the hardest. After a long history of Brazil’s transfer pricing regime walking its own path, Brazilian tax authorities have announced a significant change in direction. In a joint presentation with the Organisation for Economic Co-operation and Development, the government announced expectations for a new transfer pricing system for Brazil.
U.S.-based multinationals that are facing challenges in fitting the current Brazilian rules into the new U.S. foreign tax credit rules are breathing sighs of relief. But…there’s a long way to go to secure creditability of Brazilian taxes, even if expectations come to fruition, as the announcement only covered changes needed for Brazilian income tax to be creditable; issues with the Brazilian withholding tax remain unaddressed.
Roberto Salles, International Tax partner from KPMG in Brazil, joins podcast hosts Kimberly Majure and Kortney Wallace to discuss what’s been said, what has not, and what it all may mean for taxpayers with Brazilian operations.